Filing your taxes is just one of those tasks that no one ever really looks forward to. Even if you are pretty sure that you are going to get a refund, it can still be a chore to sit down and begin combing through all of the receipts and forms.
The IRS estimated that 20-25% of all American wait until the last two weeks to even begin preparing their taxes.
So for all of those people who spend part of the first two weeks of April each year struggling to complete their taxes, it only seems fair that you have a list to refer to for a few last minute tax tips, hints and secrets that can make the process a little bit less time consuming and difficult.
The Boy Scout Motto Applies – Be Prepared
If you are one of those procrastinators, then this might not be a tip that you didn’t know but it is likely to be one that you don’t follow. Being prepared can make filing your taxes a whole lot easier and even more importantly, less stressful. This is not to say that you need to sit down at your computer each Saturday night and enter a bunch of expenses into a spreadsheet before you allow yourself to go out for the evening. That is not any more likely to happen than you suddenly deciding to prepare your taxes on February 1st next year. But just a second or two to stuff a receipt into a box or even a gallon Ziploc bag with the month and year written on it can save you a huge amount of time and frustration looking for information and receipts in April. All you will need to do is sort the documents into a few simple piles and you will be ready to begin actually filling out the forms. This habit alone can save you an entire Sunday afternoon of digging through drawers, coat pockets, and credit card statements.
Speed Is Not Always Your Friend
As it turns out, the biggest issues that arise from tax returns can easily be avoided. Most people worry that they are filling out the forms incorrectly or putting numbers in the wrong section and that will be what gets their tax return rejected or even worse, selected for an audit. But the truth is that most of the errors on personal taxes are due to the filer rushing to complete the process. The most typical errors include mistakes like simple math errors or miscalculations, incorrectly entered social security numbers or illegible numbers if the return is handwritten and forgetting to sign and date the tax return. All of these issues can easily be avoided by just for a single year deciding not to wait until the last minute to file your taxes. Then you can see how much less stressful the process is and maybe plan a little bit of extra time for future years. Another good way to avoid these simple mistakes is to take just a little time to try out a tax prep software. Many of them are free or just a few dollars to use and they are pretty user friendly.
What If You Waited Too Long And Are Not Going To Meet The Deadline?
Most taxpayers know that it is possible to request an extension on their taxes. But not very many people know the proper way to do it and what happens after you make the request. What you need to do is file a Form 4868, aptly named Application for Automatic Extension of Time to File a U.S. Individual Tax Return. These requests are normally automatically granted and you don’t even need to give a reason for the request or qualify for a request. But what you do need to do is submit the correctly completed form by midnight on tax day. It is a process that works for around 8 million Americans each year and it only has a single drawback, you will pay a .5% late payment penalty if you owe taxes.
You Might Qualify for Free Tax Service
The reason many taxpayers put off doing their taxes is that they are intimidated by the process and all of the ever changing rules. But if you make less than $64,000 a year then you qualify to use the IRS Free File tax preparation software. This can make the process much less difficult and it won’t cost you anything to use. If you are a senior citizen, if you have disabilities or if you only speak limited English then you can also use the Volunteer Income Tax Assistance program which offers free tax preparation help to those who qualify. So there are ways to deal with filing your taxes other than waiting until the last minute and then stressing over piles of papers all night.
You Can Pay Yourself and Reduce Your Tax Liability
As you finish preparing your taxes and discover that you owe the IRS, there is a way that you might be able to reduce that amount and pay yourself in the process. Many taxpayers are unaware that they can contribute to their IRA retirement account until the tax filing deadline the following year. So instead of paying the